Downtown improvement fund getting $1.2m more

Fee is no longer voluntary

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A business association formed to upgrade Boston’s downtown is getting a boost from an unexpected source: all the companies that initially refused to contribute to the improvement effort.

Starting Jan. 1, commercial property owners within the so-called Business Improvement District will be required to pay fees to the organization under state legislative changes that eliminated companies’ ability to opt out.

In downtown Boston, that will increase annual funding by $1.2 million, or 40 percent. The money will be used to power-wash streets, install public art and landscaping, and deploy “ambassadors” to direct tourists, remove graffiti, and pick up trash.

“We know people are satisfied with the direction we’re going in, and this will allow us to improve upon the level of service already being delivered,” said Rosemarie Sansone, president of the Downtown Business Improvement District, or BID.

Formed three years ago, the BID was the first such group to be established in Boston. Sansone and other city leaders pledged to use fees from property owners to help transform the time-worn area and attract a new mix of retailers, modern homes, and office tenants.

Although the BID is widely credited with improving the downtown’s appearance, the decision to opt out by some 60 property owners had left it without funding for more substantial upgrades. The largest holdouts were the office landlords Tishman Speyer and Equity Office Properties, whose holdings accounted for about $950,000 in uncollected fees.

A spokesman for Tishman Speyer declined to comment Tuesday. Equity Office Properties did not respond to a request for comment.

Meanwhile, a company that initially declined to participate said it is now eager to join the BID, convinced the organization is making a significant difference.

“The area is cleaner, there is no doubt about it,” said John Murtha, general manager of the Omni Parker House hotel. “I’m confident the BID and its board will do a good job making sure these additional funds are well spent.”

Last week, the hotel hosted a gathering of BID members, who voted to renew the organization’s funding for another five years. That vote allowed the BID to update its rules to reflect 2012 legislative changes that eliminated the opt-out clause. A BID from Springfield successfully lobbied the Legislature to make the change.

If commercial landowners fail to pay the annual fees, BIDs can place tax liens on their property.

The increased funding coincides with a burst of development activity in the area. Hundreds of high-rise residences are being built, a hotel is under construction on Temple Place, and dozens of new stores and restaurants have opened in recent years.